The plaintiff is the widow of Robert Waters, who was 38 years old at the time of his death. Mr. Waters, who had a history of high blood pressure, experienced chest pains on August 30, 2007; he was taken to North Kansas City Hospital, where he was kept overnight. Early the next morning, tests revealed he had experienced a heart attack. In the early afternoon, a diagnostic cardiac catheterization revealed several blockages in the coronary arteries. Defendant Dr. Mitchell, an employee of defendant Meritas, was called to perform a balloon angioplasty and stent placement on a 90 percent blockage in branches of the circumflex artery. During the placement of wires and prior to inserting the balloons, a dissection occurred in the circumflex. Mr. Waters felt back pain, became combative, and tried to get off the table while Dr. Mitchell was still performing the procedure. Dr. Mitchell called for anesthesia, but intubation was difficult due to the patient’s size. Before successful intubation, Mr. Waters’s heart stopped. CPR was undertaken, but Mr. Waters died at 4:45 P.M. The plaintiff brought suit claiming that Dr. Mitchell failed to recognize and treat an injury to the left main artery in a timely manner, which contributed to and caused death. The defendants claimed there was no injury in the left main artery (although there was a dissection in the circumflex) and that Dr. Mitchell met the standard of care. The defendants claimed death was due to hypoxia from a prolonged and difficult intubation.
After seven days of evidence the jury found in favor of the defendants.
Caps on Damages in Medical Malpractice Cases
by John R. Hicks
The constitutionality of damage caps is an important issue for health-care providers, liability insurers, and attorneys who represent them. Health-care provider groups and liability insurers see damage caps as an effective way of limiting their potential exposure, thereby making the cost of doing business more predictable. However, states around the country continue to propose and to debate the need for damage caps as well as the constitutionality of the damage caps already in place. These debates undermine the ability of legislatures to pass damage caps where they do not already exist and limit the effectiveness of the caps that are in place because health-care providers and liability insurers question whether the caps can be relied upon.
This article attempts to provide basic information about the nature of damage caps, a summary of the damage caps that are currently in place, and a summary of the most common constitutional challenges.
Damage Caps in Medical Malpractice Cases
Medical malpractice verdicts are composed of economic and noneconomic damages. Economic damages are intended to put a plaintiff in the same financial position as he or she would have been in had the malpractice not occurred. However, noneconomic damages are intended to compensate a plaintiff for the nonpecuniary harm, such as pain and suffering, inconvenience, loss of consortium, and decreased quality of life, caused by a defendant’s negligence. Unfortunately, there is no clear method for determining noneconomic damages. As a result, a jury is often given little to no guidance on how to arrive at a monetary figure that would justly compensate a plaintiff for the plaintiff’s loss.
Most damage caps only apply to noneconomic damages. The rationale is that nonpecuniary harm is difficult, if not impossible, to quantify. When the task of calculating these damages is left to the complete discretion of a jury, the outcome naturally varies from case to case. This makes evaluating the potential exposure of an individual claim much more difficult. Therefore, placing a limit on noneconomic damages does more than simply reduce a liability insurer’s potential exposure. It also increases certainty in the underwriting process. This ultimately leads to less volatility in insurance premiums for health-care providers, allowing them to more accurately calculate the cost of doing business.
States that Currently Have a Noneconomic Damages Cap in Medical Malpractice Actions
Currently, 24 states place a cap on noneconomic damages in medical malpractice actions. Some states, such as Missouri, have separates caps for wrongful death that will likely withstand an eventual constitutional challenge even though the cap on common law negligence has been stricken. The following list summarizes only those statutes that would apply in common law medical malpractice cases.
Alaska: Alaska Statute § 09.55.549, limits noneconomic damages awarded against a health-care provider to $250,000 unless the claim is for wrongful death or for an injury that is more than 70 percent disabling, in which case the damages are capped at $400,000.
California: Cal. Civ. Code § 3333.2, limits noneconomic damages awarded against health-care providers to $250,000. Held constitutional in Fein v. Permanente Medical Group, 695 P.2d 665 (Cal. 1985).
Colorado: Colo. Rev. Stat. § 13-64-202, limits noneconomic damages awarded against health-care providers to $300,000 and also limits the total award to $1,000,000. Held constitutional in Garhart ex rel Tinsman v. Columbia/Healthone, LLC, 95 P.3d 571 (2004).
Hawaii: Haw. Rev. Stat. § 663-8.7, limits noneconomic damages awarded in any case to $375,000.
Idaho: Idaho Code Ann. § 6-1603, limits noneconomic damages awarded in any case to $250,000. However, this amount is adjusted based on the Idaho Industrial Commission’s average annual wage computation. Held constitutional in Kirkland v. Blaine County Medical Center, 4 P.3d 1115 (Idaho 2000).
Kansas: Kan. Stat. Ann. § 60-19a02, limits noneconomic damages awarded in any case to $250,000. However, in January 2015, the statute will be amended to increase the cap incrementally to $350,000 over a period of eight years. This amendment was apparently in response to Miller v. Johnson, 295 Kan. 636 (2012), which held that the cap on noneconomic damages was constitutional but stated that it was “troubling” that the cap had not been raised in the last 20 years.
Louisiana: La. Rev. Stat. Ann. § 40:1299.42 limits all damages awarded against health-care providers to $500,000. Held constitutional in Oliver v. Magnolia Clinic, 85 So. 3d 39 (La. 2012).
Maryland: Md. Code Ann., Cts. & Jud. Proc. § 3-2A-09 42 limits noneconomic damages awarded against health-care providers to $650,000 with an annual increase of $15,000. Held constitutional in DRD Pool Serv. Freed, 416 Md. 46 (2010).
Massachusetts: Mass. Gen. Laws ch. 231, § 60H limits noneconomic damages awarded against health-care providers to $500,000. However, this cap can be increased if there is a specific finding that there has been a substantial or permanent loss or impairment of a bodily function or substantial disfigurement, or other special circumstances in a case that warrants a finding that imposing such a limitation would deprive a plaintiff of just compensation for the injuries sustained.
Michigan: Mich. Comp. Laws Ann. § 600.1483 limits noneconomic damages awarded against health-care providers to $280,000 but is adjusted annually for inflation. However, the cap is raised to $500,000 in cases when the negligence caused paralysis due to an injury to the brain or the spinal cord, permanent cognitive impairment, or permanent damage to a reproductive organ. Held constitutional in Zdrojewski v. Murphy, 657 N.W. 2d 721 (Mich. Ct. App. 2002).
Mississippi: Miss. Code Ann. § 11-1-60(2)(a) limits noneconomic damages awarded against health-care providers to $500,000. The statute limits noneconomic damages in all other cases to $1,000,000.
Montana: Mont. Code Ann. § 25-9-411 limits noneconomic damages awarded against health-care providers to $250,000.
Nebraska: Neb. Rev. Stat. § 44-2825 limits the total amount of damages recoverable in a medical malpractice case to $1,750,000. However, the individual provider’s liability is capped at $500,000 with the state’s excess liability fund covering the remainder. Held constitutional in Gourley v. Nebraska, Methodist Health Systems, Inc., 265 Neb. 918 (2003).
Nevada: Nev. Rev. Stat. § 41A.035 limits noneconomic damages awarded against health-care providers to $350,000 unless there is evidence of gross malpractice.
New Mexico: N.M. Stat. Ann. § 41-5-6 (1978) limits the total amount of damages awarded against health-care providers to $600,000 plus medical expenses and related benefits.
North Dakota: N.D. Cent. Code § 32-42-02 limits noneconomic damages awarded against health-care providers to $500,000.
Ohio: Ohio Rev. Code Ann. § 2323.43 limits noneconomic damages awarded against health-care providers to $250,000, or three times the economic damages up to $350,000 per plaintiff and $500,000 per occurrence.
Oklahoma: Okla. Stat. tit. 23 § 61.2 limits noneconomic damages in any case to $350,000. However, the limit will not be applied in cases when there is clear and convincing evidence of reckless disregard for the rights of another, gross negligence, fraudulent conduct, intentional conduct, or malice.
South Carolina: S.C. Code Ann. § 15-32-220 limits noneconomic damages rendered against a single defendant in a medical malpractice case to $350,000 and caps the total amount of noneconomic damages rendered against all defendants to $1,050,000.
South Dakota: S.D. Codified Laws § 21-3-11 limits noneconomic damages awarded against health-care providers to $500,000.
Texas: Tex. Civ. Prac. & Rem. Code Ann. § 74.301 limits noneconomic damages awarded against an individual defendant in a medical malpractice action to $250,000 and caps the total award of noneconomic damages against multiple defendants to $500,000, regardless of the number of defendants. In 2003, Texas voters approved a constitutional amendment giving the legislature the authority to determine the limit of liability for noneconomic damages in medical malpractice cases.
Utah: Utah Code Ann. § 78B-3-410 limits noneconomic damages awarded against health-care providers to $450,000. Held constitutional in Judd v. Drezga, 103 P.3d 135 (2004).
Virginia: Va. Code Ann § 8.01-581.15 limits the total damages awarded against health-care providers to $2,200,000. This cap is increased annually until 2031, at which time the cap will be $3,000,000. Held constitutional in Puliam v. Coastal Emergency Services of Richmond, Inc., 257 Va. 1 (1999).
West Virginia: W. Va. Code § 55-7B-8 limits the award of noneconomic damages awarded against health-care providers to $250,000. It also caps the total award of damages at $500,000 with the cap being adjusted each year for inflation. Held constitutional in Robinson v. Charleston Area Medical Ctr., 186 W. Va. 720 (1991).
Common Constitutional Challenges
Challenges to damage caps have occurred in 26 states. The most common constitutional challenges include (1) the right to a jury trial, (2) access to courts, (3) equal protection, (4) due process, and (5) separation of powers. Of these five arguments, the one that has gained the most traction over the last several years has been the right to a jury trial.
Right to a Jury Trial
The right to a trial by jury for civil suits dates back to the signing of the Magna Carta. The Seventh Amendment to the U.S. Constitution “preserves” this right as it existed at common law. Forty-eight states have similar constitutional provisions, and some even preserve the right as “inviolate.” See Miller v. Johnson, 295 Kan. 636 (2012) (where plaintiff argued that inviolate language provided further protection to plaintiff’s right to trial by jury).
Fortunately, the majority of courts have held that damage caps do not violate the right to a trial by jury. See Gourley ex rel. Gourley v. Neb. Methodist Health Sys., Inc., 265 Neb. 981, 953, 663 N.W.2d 43 (2003) (holding damage caps did not violate the right to a jury trial even where the constitution preserves the right as inviolate); Etheridge v. Med. Ctr. Hosps., 237 Va. 87, 376 S.E.2d 525 (1989) (landmark case reasoning that “[a] remedy is a matter of law, not a matter of fact,” and that “although a party has the right to have a jury assess his damages, he has no right to have a jury dictate through an award the legal consequences of its assessment”); Kirkland ex rel. Kirkland v. Blaine County Med. Ctr., 134 Idaho 464, 466–69, 4 P.3d 1115 (2000); Maurin v. Hall, 274 Wis. 2d 28, 71, 682 N.W.2d 866 (2004); Judd v. Drezga, 103 P.3d 135, 144–45 (Utah 2004); Phillips v. Mirac, Inc., 470 Mich. 415, 429–30, 685 N.W.2d 174 (2004) (holding that damage caps did not violate the right to a jury trial, reasoning that “the amount the plaintiff actually receives was never within those things a jury can decide”); Evans v. State, 56 P.3d 1046, 1051 (Alaska 2002) (holding that a cap on noneconomic damages did not violate the right to a jury trial and reasoning that “[t]he decision to place a cap on damages awarded is a policy choice and not a re-examination of the factual question of damages determined by the jury”); Murphy v. Edmonds, 325 Md. 342, 373, 601 A.2d 102 (Md. 1992).
While the majority of courts have found that damage caps do not violate the right to a trial by jury, there is a lack of uniformity in the way that the courts have decided these cases. Damage caps have been upheld under some state constitutions while courts have struck down damage caps in other states with almost identical constitutional provisions.
Access to Courts
Thirty-nine state constitutions contain a provision guaranteeing citizens access to the court system. Some state courts have construed the open courts provision as mere procedural guarantees and have thus upheld the caps against these challenges because the caps do not prevent litigants from filing a case. See, e.g., Evans v. State, 56 P.3d 1046, 1051 (Alaska 2002). Other states characterize damage caps as a modification of an existing cause of action and therefore within the legislature’s constitutional authority. See Gourley ex rel. Gourley v. Neb. Methodist Health Sys., Inc., 265 Neb. 981, 953, 663 N.W.2d 43 (2003).
However, other states have interpreted the open courts provision as imposing substantive constraints on the legislature’s authority to restrict common law causes of action and remedies. See Lucas v. United States, 757 S.W.2d 687, 715 (1988). See also University of Miami v. Echarte, 618 So.2d 189 (Fl. 1993) (requiring a showing that damage caps are effective in achieving their intended purpose).
The Fourteenth Amendment to the U.S. Constitution prohibits states from denying citizens equal protection under the law. Most states have similar provisions in their state constitutions. Plaintiffs argue that damage caps in medical malpractice cases divide people into different classifications (malpractice plaintiffs versus non-malpractice plaintiffs) and that malpractice plaintiffs are not afforded the same protection as non-malpractice plaintiffs. Plaintiffs have even attempted to argue that women and children are disproportionately affected by the damage caps. See, e.g., Miller v. Johnson, 295 Kan. 636 (2012).
When evaluating equal protection challenges, a court must first determine what level of scrutiny should apply. The choice of scrutiny level tends to be dispositive. The majority of cases that have considered equal protection attacks upon damage caps have used a traditional rational basis test. See Edmonds v. Murphy, 573 A.2d 853 (Md. Ct. App. 1990). Under the rational basis test, a state law is constitutional unless the classification rests upon grounds wholly irrelevant to the achievement of a legitimate government objective. See Leiker v. Gafford, 245 Kan. 325, 363 (1989). Therefore, most damage caps have withstood a constitutional challenge on equal protection grounds.
States that apply a heightened level of scrutiny are less likely to find a damages cap constitutional. See Moore v. Mobile Infirmary Association, 592 So.2d 156 (Ala. 1991) (invalidating a $400,000 cap on noneconomic damages); Carson v. Maurer, 424 A.2d 825, 830 (N.H. 1980).
Due process challenges can be both procedural and substantive. The procedural due process argument assumes that a plaintiff has a vested property interest in whatever damage award a jury delivers. Plaintiffs argue that capping their damages deprives them of a portion of this property without an adequate opportunity to be heard. The procedural due process theory has never been successfully used to defeat a damage cap.
Therefore, plaintiffs will typically argue substantive due process. However, when damages are challenged under substantive due process, courts typically evaluate the argument under the same basis framework as equal protection challenges. Courts will typically find damage caps constitutional as long as there is some evidence that the caps were enacted to address a malpractice crisis in their state. See Morris v. Savoy, 576 N.E.2d 764 (Ohio 1991) (applying the rationale basis test but striking down the cap on damages because the legislature had not made any explicit findings about the efficacy of the caps).
Separation of Powers
Damage caps in medical malpractice cases have also been challenged under the separation of powers theory. Article III of the U.S. Constitution vests judicial powers exclusively in the court system. Plaintiffs argue that legislatively imposed damage caps that alter or affect the outcome of court procedures infringe upon a court’s inherent power. Most courts, however, have adopted the opposite view, holding that damage caps are a public policy issue and within the constitutional province of the legislative branch. See Kirkland 4 P.3d at 1121; Verba v. Ghaphery, 552 S.E.2d 406, 411 (W.Va. 2001); Judd ex rel. Montgomery v. Drezga, 103 P.3d 135, 145 (Utah 2004); Miller v. Johnson, 295 Kan. 636 (2012).
There are seven states with damage caps that have yet to be challenged. The outcomes of the recent constitutional challenges have been inconsistent, making it nearly impossible to predict whether these caps will remain in place. Fortunately, courts appear to be somewhat reluctant to overturn damage caps. Further, several states now have caps that have withstood multiple constitutional challenges. Health-care providers and liability insurers in these states should feel fairly certain that these caps will remain in place for the foreseeable future.
John R. Hicks is an experienced trial lawyer with Norris & Keplinger LLC in Overland Park, Kansas. Licensed in Kansas and Missouri, Mr. Hicks primarily defends physicians, hospitals, and long-term care facilities in medical malpractice cases. He is an active member of the DRI Medical Liability and Health Care Law and the Lawyers’ Professional and Ethics committees.